Custom, Excise & Service Tax Tribunal
Riba Textiles Ltd vs C.C.E., Delhi Iii on 7 October, 2015
CUSTOMS EXCISE & SERVICE TAX APPELLATE TRIBUNAL, West Block No.2, R.K.Puram, New Delhi COURT-I Date of hearing/decision: 7.10.2015 Service Tax Appeal No.1442 of 2011 Arising out of the order in appeal No.173-174/BK/RTK/2011 dated 24.5.2011 passed by the Commissioner of Central Excise (Appeals), Delhi III. For approval and signature: Honble Mr. Justice G. Raghuram, President 1 Whether Press Reporter may be allowed to see the Order for publication as per Rule 26 of the CESTAT (Procedure) Rules, 1982? 2 Whether it should be released under Rule 26 of CESTAT (Procedure) Rules, 1982 for publication in any authoritative report or not? 3 Whether their Lordships wish to see the fair copy of the Order? 4 Whether Order is to be circulated to the Departmental authorities? Riba Textiles Ltd. Appellant Vs. C.C.E., Delhi III . Respondent
Appearance:
Present Shri B.S. Yadav, Advocate for the appellant Present Shri Satyaveer Singh, Chief Commissioner (A.R.) for Revenue Coram: Honble Mr. Justice G. Raghuram, President Final Order No.53167/2015 Per Justice G. Raghuram:
The assessee is the appellant. The appeal is preferred against the order dated 24.5.2011 passed by the Commissioner of Central Excise (Appeals), Delhi III rejecting appellants appeal preferred against the primary adjudication order dated 9.2.2010 passed by Deputy Commissioner, Panipat. The primary adjudication order rejected refund claim for Rs.12,48,993/-.
2. The relevant facts may be noticed. The appellant is a manufacturer of Terry Towels and other made up textile articles as a 100% EOU. During 1.10.2006 to 31.12.2007 appellant availed cenvat credit of Rs.11,79,666/- on CHA and other post factory input services utilized upto the place of removal i.e. the port of Export in respect of export of its manufactured goods. Audit raised objection as to disentitlement for availment of cenvat credit on CHA service. By the letter dated 19.3.2008, the concerned Superintendent, Central Excise, Panipat addressed to the appellant intimating denial of cenvat credit availed and calling for its remittance along with interest. In response, the appellant addressed a letter dated 2.6.2008 contending that the audit objection is erroneous and the appellant is entitled to avail cenvat credit on input services incurred upto the place of removal which in the case of goods is the port of export. By a further letter dated 17.6.2008, appellant resisted the audit objection and departmental premise regarding appellants disentitlement to cenvat credit and stated that the amount of cenvat credit availed along with interest ion all amounting to Rs.12,48,993/- was reversed by it and the interest component of Rs.69,327/- was also deposited vide TR-06 challan dated 16.06.2008, in cash. In its letter dated 17.6.2008, the appellant categorically informed Revenue that it had reversed the cenvat credit and remitted the interest component as well, under protest and preserves its right to seek refund and recourse other legal measures.
3. However and despite appellants reversal of cenvat credit availed along remittance of interest in cash under protest, Revenue initiated proceedings and issued a show cause notice dated 16.12.2008 proposing denial of cenvat credit of Rs.11,79,666/- and recovery of the same along with interest and penalties under Rule 15 of the Cenvat Credit Rules, 2004 and under Section 78 of the Finance Act, 1994.These proceedings culminated in an adjudication order dated 24.12.2009 passed by the Additional Commissioner, Central Excise, Rohtak. This order clearly recorded appellants disentitlement to cenvat credit but dropped proceedings in view of the fact that the appellant had already reversed the cenvat credit as also remitted interest component vide TR-06 challan, adverted to (supra). The order dated 24.12.2009 however imposed penalty of Rs.2000/- under Rule 15 of Cenvat Credit Rules, 2004 as the penalty for irregular availment of cenvat credit. This order has become final and was not contested by the appellant herein before any forum. On 15.12.2008, the appellant sought refund of Rs.12,48,993/- (being the reversed cenvat credit availed + the interest component remitted) under Section 11B of the Central Excise Act, 1944. By the order dated 9.2.2010, the Additional Commissioner, Central Excise, Panipat rejected the claim for refund on the ground that availment of cenvat credit by the appellant having been declared illegal and penalty of Rs.2000/- imposed under Rule 15 of the Cenvat Credit Rules 2004 by the order dated 24.12.2009 of the adjudicating authority, the claim for refund of the cenvat credit reversed and interest remitted was not legitimate, and could not be sanctioned. Aggrieved thereby, the appellant preferred an appeal which was also rejected by the impugned order. Hence this appeal.
5. Ld. Counsel for the appellant contends that CHA services were utilized by the appellant for facilitating clearance of its exported goods from the port of Export i.e. the place of removal in case of exported goods. Therefore, the concurrent findings by the authorities below rejecting the refund claim are unsustainable . This contention by the ld. Counsel for the appellant has substantial merit.
6. The order dated 24.12.2009 was passed in adjudication proceedings initiated by a show cause notice alleging illegal availment of cenvat credit and for recovery of the same along with interest and penalties. These proceedings culminated in the order dated 24.12.2009 whereunder the finding is recorded that the appellant was disentitled to avail cenvat credit, but the proceedings were dropped since the appellant had already reversed the cenvat credit and had remitted interest thereon, in cash vide TR-06 challan. The order dated 24.12.2009 however imposed penalty under Rule 15 of Cenvat Credit Rules, 2004 on the appellant for having unauthorizedly availed cenvat credit. This proceeding has become final.
7. In the above circumstances, the appellant cannot be heard to contend that cenvat credit on CHA input service availed by it was valid and legitimately availed. The adjudication order dated 24.8.2009 and the conclusion thereon that the appellant irregularly availed cenvat credit estopps the appellant for canvassing such a contention. The conclusion of the authorities below that the appellant was disentitled to refund of Rs.12,48,993/- is therefore impeccable and warrants no appellate intervention. The appeal is without merits and is dismissed. No costs however.
(Justice G. Raghuram) President scd/ 1